Form of Non-Employee Director Stock Option Grant Notice and Agreement



 Exhibit 10.20 
 SILICON STORAGE TECHNOLOGY, INC. 
 NON-EMPLOYEE DIRECTOR 
 STOCK OPTION
GRANT NOTICE 
 2008 EQUITY INCENTIVE PLAN 
 Silicon Storage Technology, Inc. (the “Company”), pursuant to its 2008 Equity Incentive Plan (the “Plan”), hereby grants
to Optionholder an option to purchase the number of shares of the Company’s Common Stock set forth below. This option is subject to all of the terms and conditions as set forth herein and in the Option Agreement, the Plan, and the Notice of
Exercise, all of which are attached hereto and incorporated herein in their entirety. 
  

							
		 	 Optionholder:
	 	 	 	
		 	 Date of Grant:
	 	 	 	
		 	 Vesting Commencement Date:
	 	 	 	
		 	 Number of Shares Subject to Option:
	 	 	 	
		 	 Exercise Price (Per Share):
	 	 	 	
		 	 Total Exercise Price:
	 	 	 	
		 	 Expiration Date:
	 	 	 	

  

			
		
	Type of Grant:	  	 ̈ Nonstatutory Stock Option
		
	Exercise Schedule:	  	 ̈ Same as Vesting Schedule
		
	Vesting Schedule:	  	[                    , subject to the Optionholder’s Continuous Service
through such time.] Notwithstanding the foregoing, in the event of a Change in Control, this option will become vested and exercisable in full immediately prior to the Change in Control.
		
	Payment:	  	By one or a combination of the following items (described in the Option Agreement):
		
		  	 •        By cash, check bank draft or money order payable to the Company

		
		  	 •        Pursuant to a Regulation T Program if the shares are publicly
traded

		
		  	 •        Subject to the Company’s consent at the time of exercise, by delivery of
already-owned shares

		
		  	 •        Subject to the Company’s consent at the time of exercise, by a “net
exercise” arrangement


 Additional Terms/Acknowledgements: The undersigned Optionholder acknowledges receipt of, and understands
and agrees to, this Stock Option Grant Notice, the Option Agreement and the Plan. Optionholder further acknowledges that as of the Date of Grant, this Stock Option Grant Notice, the Option Agreement, and the Plan set forth the entire understanding
between Optionholder and the Company regarding the acquisition of stock in the Company and supersede all prior oral and written agreements on that subject with the exception of (i) options previously granted and delivered to Optionholder under
the Plan, and (ii) the following agreements only: 
  

							
		  	OTHER AGREEMENTS:	  		  	 
		  		  		  	 

  

									
	SILICON STORAGE TECHNOLOGY, INC.	 		 	OPTIONHOLDER:
					
	By: 	 	 	 		 	 	 	 
		 	Signature	 		 		 	Signature
	Title:	 	 	 		 	Date:	 	 
					
	Date:	 	 	 		 		 	








 SILICON STORAGE TECHNOLOGY, INC.

 2008 EQUITY INCENTIVE PLAN 
 OPTION AGREEMENT 
 (NON-EMPLOYEE DIRECTOR NONSTATUTORY STOCK OPTION) 
 Pursuant to your Stock Option Grant Notice (“Grant Notice”) and this Option Agreement, Silicon Storage Technology, Inc. (the “Company”) has granted you an option under
its 2008 Equity Incentive Plan (the “Plan”) to purchase the number of shares of the Company’s Common Stock indicated in your Grant Notice at the exercise price indicated in your Grant Notice. Defined terms not explicitly
defined in this Option Agreement but defined in the Plan shall have the same definitions as in the Plan. 
 The details of your option are as
follows: 
 1. VESTING. Subject to the limitations contained herein, your option will vest as provided in your Grant
Notice, provided that vesting will cease upon the termination of your Continuous Service. 
 2. NUMBER OF
SHARES AND EXERCISE PRICE. The number of shares of Common Stock subject to your option and your exercise price per share referenced in your Grant Notice may be adjusted from time to
time for Capitalization Adjustments. 
 3. METHOD OF PAYMENT. Payment of the exercise
price is due in full upon exercise of all or any part of your option. You may elect to make payment of the exercise price in cash or by check or in any other manner permitted by your Grant Notice, subject to the following: 

(a) Bank draft or money order payable to the Company. 
 (b) Provided that at the time of exercise the Common Stock is publicly traded and quoted regularly in The Wall Street
Journal, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the aggregate exercise price to the Company from the sales proceeds. 
 (c) Subject to the consent
of the Company at the time of exercise, by delivery to the Company (either by actual delivery or attestation) of already-owned shares of Common Stock that are owned free and clear of any liens, claims, encumbrances or security interests, and that
are valued at Fair Market Value on the date of exercise. Notwithstanding the foregoing, you may not exercise your option by tender to the Company of Common Stock to the extent such tender would violate the provisions of any law, regulation or
agreement restricting the redemption of the Company’s stock. 
  

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 (d) Subject to the consent of the Company at the time of exercise, by a “net
exercise” arrangement pursuant to which the Company will reduce the number of shares of Common Stock issued upon exercise of your option by the largest whole number of shares with a Fair Market Value that does not exceed the aggregate exercise
price; provided, however, that the Company shall accept a cash or other payment from you to the extent of any remaining balance of the aggregate exercise price not satisfied by such reduction in the number of whole shares to be issued; provided
further, however, that shares of Common Stock will no longer be outstanding under your option and will not be exercisable thereafter to the extent that (1) shares are used to pay the exercise price pursuant to the “net exercise,”
(2) shares are delivered to you as a result of such exercise, and (3) shares are withheld to satisfy tax withholding obligations. 
 4. WHOLE SHARES. You may exercise your option only for whole shares of Common Stock. 
 5.
SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary contained herein, you may not exercise your option unless the shares of Common Stock issuable upon such exercise are then registered
under the Securities Act or, if such shares of Common Stock are not then so registered, the Company has determined that such exercise and issuance would be exempt from the registration requirements of the Securities Act. The exercise of your option
also must comply with other applicable laws and regulations governing your option, and you may not exercise your option if the Company determines that such exercise would not be in material compliance with such laws and regulations. 
 6. TERM. You may not exercise your option before the commencement or after the expiration of its term. The term of your option
commences on the Date of Grant and expires upon the earliest of the following: 
 (a) twelve (12) months after the
termination of your Continuous Service for any reason other than your Disability or death, provided that if during any part of such twelve (12)-month period you may not exercise your option solely because of the condition set forth in the preceding
paragraph relating to “Securities Law Compliance,” your option shall not expire until the earlier of the Expiration Date or until it shall have been exercisable for an aggregate period of twelve (12) months after the termination of
your Continuous Service; 
 (b) twelve (12) months after the termination of your Continuous Service due to your
Disability; 
 (c) eighteen (18) months after your death if you die either during your Continuous Service or
within three (3) months after your Continuous Service terminates; 
 (d) the Expiration Date indicated in your
Grant Notice; or 
 (e) the day before the tenth (10th) anniversary of the Date of Grant. 
 7. EXERCISE. 
 (a) You may exercise the vested portion of your option during its term by delivering a Notice of Exercise (in a form designated by the Company) together with the exercise price to the Secretary of the Company, or to such other person
as the Company may designate, during regular business hours, together with such additional documents as the Company may then require. 
  

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 (b) By exercising your option you agree that, as a condition to any exercise of
your option, the Company may require you to enter into an arrangement providing for the payment by you to the Company of any tax withholding obligation of the Company arising by reason of (1) the exercise of your option, (2) the lapse of
any substantial risk of forfeiture to which the shares of Common Stock are subject at the time of exercise, or (3) the disposition of shares of Common Stock acquired upon such exercise. 
 8. TRANSFERABILITY. 
 (a) Restrictions on Transfer. Your option shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during your lifetime only by you; provided, however,
that the Board may, in its sole discretion, permit transfer of your options in a manner that is not prohibited by applicable tax and securities laws upon your request. 
 (b) Domestic Relations Orders. Notwithstanding the foregoing, your option may be transferred pursuant to a domestic relations
order. 
 (c) Beneficiary Designation. Notwithstanding the foregoing, you may, by delivering written notice to the
Company, in a form provided by or otherwise satisfactory to the Company and any broker designated by the Company to effect option exercises, designate a third party who, in the event of your death, shall thereafter be entitled to exercise your
option. In the absence of such a designation, the executor or administrator of your estate shall be entitled to exercise your option. 
 9. OPTION NOT A SERVICE CONTRACT. Your option is not an employment or service contract, and nothing in your option shall be deemed to create in any way
whatsoever any obligation on your part to continue in the employ of the Company or an Affiliate, or of the Company or an Affiliate to continue your employment. In addition, nothing in your option shall obligate the Company or an Affiliate, their
respective stockholders, Boards of Directors, Officers or Employees to continue any relationship that you might have as a Director or Consultant for the Company or an Affiliate. 
 10. WITHHOLDING OBLIGATIONS. 
 (a) At the time you exercise your option, in whole or in part, or at any time thereafter as requested by the Company, you hereby
authorize withholding from payroll and any other amounts payable to you, and otherwise agree to make adequate provision for (including by means of a “cashless exercise” pursuant to a program developed under Regulation T as promulgated by
the Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with the exercise of
your option. 
  

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 (b) Upon your request and subject to approval by the Company, in its sole
discretion, and compliance with any applicable legal conditions or restrictions, the Company may withhold from fully vested shares of Common Stock otherwise issuable to you upon the exercise of your option a number of whole shares of Common Stock
having a Fair Market Value, determined by the Company as of the date of exercise, not in excess of the minimum amount of tax required to be withheld by law (or such lower amount as may be necessary to avoid classification of your option as a
liability for financial accounting purposes). If the date of determination of any tax withholding obligation is deferred to a date later than the date of exercise of your option, share withholding pursuant to the preceding sentence shall not be
permitted unless you make a proper and timely election under Section 83(b) of the Code, covering the aggregate number of shares of Common Stock acquired upon such exercise with respect to which such determination is otherwise deferred, to
accelerate the determination of such tax withholding obligation to the date of exercise of your option. Notwithstanding the filing of such election, shares of Common Stock shall be withheld solely from fully vested shares of Common Stock determined
as of the date of exercise of your option that are otherwise issuable to you upon such exercise. Any adverse consequences to you arising in connection with such share withholding procedure shall be your sole responsibility. 
 (c) You may not exercise your option unless the tax withholding obligations of the Company and/or any Affiliate are satisfied.
Accordingly, you may not be able to exercise your option when desired even though your option is vested, and the Company shall have no obligation to issue a certificate for such shares of Common Stock or release such shares of Common Stock from any
escrow provided for herein unless such obligations are satisfied. 
 11. TAX
CONSEQUENCES. You hereby agree that the Company does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimizes your tax liabilities. You shall not make any claim
against the Company, or any of its Officers, Directors, Employees or Affiliates related to tax liabilities arising from your option or your other compensation. In particular, you acknowledge that this option is exempt from Section 409A of the
Code only if the exercise price per share specified in the Grant Notice is at least equal to the “fair market value” per share of the Common Stock on the Date of Grant and there is no other impermissible deferral of compensation associated
with the option. 
 12. NOTICES. Any notices provided for in your option or the Plan shall be given in writing and
shall be deemed effectively given upon receipt or, in the case of notices delivered by mail by the Company to you, five (5) days after deposit in the United States mail, postage prepaid, addressed to you at the last address you provided to the
Company. 
 13. GOVERNING PLAN DOCUMENT. Your option is subject to all the provisions of
the Plan, the provisions of which are hereby made a part of your option, and is further subject to all interpretations, amendments, rules and regulations, which may from time to time be promulgated and adopted pursuant to the Plan. In the event of
any conflict between the provisions of your option and those of the Plan, the provisions of the Plan shall control. 
  

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 NOTICE OF EXERCISE 
 SILICON STORAGE TECHNOLOGY, INC. 
 1171 SONORA COURT 
 SUNNYVALE, CA 94086 
 Date of Exercise:                     

 Ladies and Gentlemen: 
 This constitutes
notice under my stock option that I elect to purchase the number of shares for the price set forth below. 
  

					
	Type of option (check one):	  	Nonstatutory    ̈	 	
			
	Stock option dated:	  	_______________	 	
			
	 Number of shares as
 to which option is
 exercised:
	  	_______________	 	
			
	 Certificates to be
 issued in name of:
	  	_______________	 	
			
	Total exercise price:	  	$______________	 	
			
	Cash or check delivered herewith:	  	$______________	 	
			
	Regulation T Program (cashless exercise)	  	$______________	 	
			
	Value of                      shares of Silicon Storage Technology, Inc. common stock
delivered herewith1:	  	$______________	 	
			
	Value of                      shares of Silicon Storage Technology, Inc. common stock
pursuant to net exercise2:	  	$______________	 	

  
  

	 1
	 Subject to the consent of Silicon Storage Technology, Inc. at the time of exercise. Shares must be valued in accordance
with the terms of the option being exercised, must have been owned for the minimum period required in the option, and must be owned free and clear of any liens, claims, encumbrances or security interests. Certificates must be endorsed or accompanied
by an executed assignment separate from certificate. 


  

	 2
	 Silicon Storage Technology, Inc. must have established net exercise procedures at the time of exercise in order to
utilize this payment method and must expressly consent to your use of net exercise at the time of exercise. 


  

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 By this exercise, I agree (i) to provide such additional documents as you may require pursuant to
the terms of the 2008 Equity Incentive Plan, and (ii) to provide for the payment by me to you (in the manner designated by you) of your withholding obligation, if any, relating to the exercise of this option. 
  

	
	Very truly yours,
	
	  


  

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